Motor Advice on a Chevy Avalanche
 

Hi all,
I had bought a used 2003 Chevy Avalanche couple of months ago. It has around 225K miles on it. I tried turning it on this morning and the motor was making a loud thudding noise and it would shut off. Then i got it towed to the dealership and they said the motor is done. They quoted me almost 8k for getting a crate motor including motor. I def do not want to spend that much money. I have read a lot of conversations on the forums and still a little confused if 1) i should buy a crate motor and get it installed? The dealership said they would install whatever motor i bought. It would cost between $2000-$2500 for labor. They quoted $4200 on the GM engine. I could possibly get something cheaper online. If so, what is the best place to buy?
2) or just rebuild the motor i have?
Obviously I am looking for the cheapest and best option. I just don't want to spend $8 k on this truck. After reading on forums, i feel comfortable spending $3k-$4k. Please advice..
Thanks a lot!